Lexpert Magazine

LEXPERT MAGAZINE | NOVEMBER/DECEMBER 2016 13 tunity for a little comic relief. Our initial name for the project was "Cowpad," aer Texel's filter media used in mat-pads for milk cows. But when we considered that "Cowpad" would be all over documents and presentations used to communicate with our lawyers, accountants, bankers and the target's employees, we decided to make a change. But to keep linkage to the origi- nal name — and satisfy those concerned about superstition when changing a project name aer launch — we ended up naming the deal "Project Pad." Leopold: I do know that it can oen be a bit of a challenge for American clients when they do transactions in Québec for the first time, learning the ins and outs of Québec- or Canadian-specific legal rules, having to translate their presentations to employees, etc. But language was never really an issue for us; both sets of lawyers were accus- tomed to doing deals bilingually, and could operate fluidly in both French and English. LEXPERT: What are some of the synergies you envision from this combination of very different businesses? McDaniel: Texel's manufacturing technolo- gies, processes and raw materials are very similar to our capabilities prior to complet- ing the deal. e customers and business segments they operate in, however, are completely different. Our legacy business primarily focused on air filtration media for power generation, cement and asphalt production and other industrial processes. In contrast, Texel supplies to a variety of other markets such as geosynthetics, liquid filtration, automotive and medical. LEXPERT: You say you will apply Lydall Lean Six Sigma principles to the Texel business. Will you be cutting jobs or mov- ing any employees? McDaniel: e go-to-market strategy for each respective business will be preserved; both companies have strong leading brands. e application of Lydall Lean Six Sigma has numerous advantages, includ- ing freeing up existing capacity for future growth opportunities. As for jobs and moving people, being a global company provides our employees with more oppor- tunities to advance their career not only at their current location. is is something we encourage and is equally extended to our new employees at Texel. LEXPERT: What would you say was most memorable about this deal? McDaniel: Most memorable? Easy … the first day, post-closing. Lydall's senior lead- ership team was on site during an all-hands, all-shis, all-sites meeting to welcome nearly 300 Texel employees into the Lydall family. Not only were we well received, but we felt quite at home. … e Texel employ- ees were engaged, energetic and reflected a culture that is clearly aligned with Lydall's. e positive energy was infectious! Leopold: Having dinner with Chad and his family in Salzburg! At a key juncture of the deal, Chad and I were both in Europe only to discover at the last minute that we would be in Salzburg on the same day. Surreal mo- ment as we sat together in a wonderful hotel overlooking the city, talking about some key deal points and spending some personal time together. LEXPERT: Is this the first Canadian acqui- sition for Lydall? Should we expect more? McDaniel: Yes, this is Lydall's first Cana- dian acquisition. Our primary goal in any acquisition is identifying the right strategic rationale and fit. is can lead us in any di- rection … including Canada. Leopold: We look forward to building on the solid relationship we established with Lydall on this initial transaction and hav- ing the opportunity to work with Lydall on future transactions in Canada, as well as collaborating with them on the integration and growth of the Texel business. (For a summary and full list of legal advisors, visit lexpert.ca) ON THE DEAL ON THE TREND Volume Up, Activity Way Down Recently announced blockbusters (Agrium-Potash, Enbridge-Spectra) sent deal volumes way up in the third quarter, but as a 10-year graphical analysis shows, activity remains low, with only 54 deals (over US$50 million) announced July 1 to September 30. In fact, deal activity in the most recent quarter was at its lowest point since the third quarter of 2009. GRAPHIC BY DAVID DIAS; SOURCE: THOMSON REUTERS

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